Free Tax Guide
Filing Requirements for Those With Foreign Assets, Form 8938
Key Takeaway
Form 8938 FATCA reporting involves four key determinations: (1) who files — specified individuals and domestic entities with specified foreign financial assets; (2) thresholds — starting at $50K single / $100K MFJ end-of-year for U.S. residents, with higher thresholds abroad; (3) what counts — specified foreign financial assets broader than FBAR; and (4) penalties — $10K base, up to $50K continuation, plus 40% accuracy-related on related tax underpayment. The short version is that Form 8938 overlaps FBAR but covers more asset types and has higher thresholds. In our experience, most taxpayers who need to file 8938 also need to file FBAR.1
Form 8938 question? A 15-minute consultation is free.
Four Form 8938 FATCA determinations.
If you hold foreign financial accounts or assets above the FBAR or Form 8938 thresholds:
Form 8938 and FBAR filing failures are among the most penalized offshore compliance issues — and the IRS and DOJ actively pursue willful non-disclosure. A free 15-minute call covers what your disclosure obligations are, whether prior non-filing is willful, and what the realistic options are for getting into compliance.
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The Four Form 8938 Determinations
WhoSpecified PersonsThreshold$50K/$100K+WhatSpecified AssetsPenalty$10K + 40%
| Determination | Application2 |
|---|---|
| Who Files | Specified individuals / domestic entities |
| Thresholds | $50K / $100K (U.S.) — higher abroad |
| What Reported | Specified foreign financial assets |
| Penalty | $10K base + continuation + accuracy |
Quick Reference
Jump to: who, threshold, what, or penalty.
1. Who Must File
Specified individuals and domestic entities with specified foreign financial assets.
If this is you: U.S. citizen, resident, or specified domestic entity. Specified foreign financial assets above thresholds. Form 8938 attached to 1040. Separate from FBAR.
Who-Files Strategy
- Determine specified person status.
- Identify specified foreign financial assets.
- Measure values end-of-year and during year.
- Apply appropriate threshold.
- File 8938 if threshold met.
2. Filing Thresholds
$50K/$100K end-of-year U.S.; higher thresholds abroad.
If this is you: U.S. resident single: >$50K end-of-year or >$75K any time. U.S. resident MFJ: >$100K EOY or >$150K any time. Thresholds significantly higher if living abroad.
Form 8938 Filing Thresholds — Tax Year 2025
The IRS has not changed Form 8938 thresholds since FATCA was enacted in 2011. The following thresholds apply for Tax Year 2025 and are expected to remain unchanged for Tax Year 2026.
| Filing Status | Resident in U.S. | Residing Abroad |
|---|---|---|
| Single / MFS | Year-end: >$50,000 Any time: >$75,000 |
Year-end: >$200,000 Any time: >$300,000 |
| Married Filing Jointly | Year-end: >$100,000 Any time: >$150,000 |
Year-end: >$400,000 Any time: >$600,000 |
“Year-end” = value on December 31. “Any time” = maximum value at any point during the year. Either threshold triggers the filing obligation — whichever is exceeded first. A taxpayer who exceeds the “any time” threshold must file even if their December 31 value is below the year-end threshold.
In practice, taxpayers who meet the Form 8938 threshold almost always also meet the FBAR filing threshold ($10,000 aggregate at any point during the year). These are separate filing requirements — FBAR goes to FinCEN; Form 8938 attaches to the federal tax return. Failing to file either when required can result in penalties that run independently.
3. What Must Be Reported
Specified foreign financial assets — broader than FBAR.
If this is you: Foreign bank accounts, securities, foreign stocks held outside account, foreign partnership / corporation interests, foreign trust / estate interests, foreign-issued life insurance with cash value, foreign hedge funds and PFICs.
4. Penalty Structure
$10K base, up to $50K continuation, 40% accuracy-related.
If this is you: Missed 8938. $10K initial penalty. Additional $10K per 30 days after IRS notice (max $50K). 40% accuracy-related on related underpayment. Reasonable cause defense available.
Form 8938 question? Book consultation.
Form 8938 Document Lookup
| Authority / Form | Purpose |
|---|---|
| Form 8938 | FATCA specified foreign assets |
| FinCEN 114 | FBAR (separate regime) |
| IRC §6038D | 8938 authority |
| Treas. Reg. §1.6038D-1 to -8 | 8938 regulations |
| IRC §6662(j) | 40% accuracy penalty |
Form 8938 Statute
- 6-year income tax statute for foreign omissions >$5K.
- Statute doesn’t start for unfiled 8938.
- Can retroactively expose earlier years.
Form 8938 Patterns
| Situation | Outcome |
|---|---|
| Timely 8938 | No penalty |
| Missed 8938 with income | $10K + 40% accuracy |
| Missed 8938 no income | $10K + reasonable cause |
| FATCA match | IRS automated flag |
Form 8938 Escalation
FATCA Match
Foreign institution FATCA report crosschecked.
Examination
Underlying income + reporting compliance.
Penalty
$10K + continuation + accuracy.
First 48 Hours
- Identify specified foreign financial assets.
- Measure year-end and high-water values.
- Apply appropriate threshold.
- Evaluate prior-year gaps.
- Engage counsel.
★Brotman Law handles Form 8938 and FATCA compliance. Based in San Diego.
The ROI Question
$10K per year plus 40% accuracy penalty stacks quickly. Professional help essential for multi-year, multi-asset situations.
When to Engage
- Foreign financial assets.
- Missed 8938.
- FATCA-related IRS inquiry.
- Complex asset mix.
Form 8938 question?
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Guide Chapters
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Frequently Asked Questions
What is Form 8938?
FATCA Statement of Specified Foreign Financial Assets. Attached to Form 1040. Separate from FBAR. Broader asset coverage than FBAR; higher thresholds.
What are 8938 thresholds?
U.S. resident single: >$50K EOY or >$75K any time. MFJ: >$100K EOY or >$150K any time. U.S. citizen abroad: $200K EOY / $300K any time single; $400K / $600K MFJ.
How does 8938 differ from FBAR?
Different statutes (Title 26 vs. Title 31). 8938 attached to 1040; FBAR separate FinCEN filing. Thresholds higher for 8938. Both often required; not duplicative.
What counts as specified asset?
Foreign financial accounts, foreign stocks / securities not in accounts, foreign partnerships / corps, foreign trusts, foreign life insurance with cash value. Broader than FBAR.
Do foreign pensions count?
Some yes. Qualified plans treated similarly to U.S. retirement may be excluded. Non-qualified foreign pensions typically reportable. Facts-specific.
Does directly-held real estate count?
No. Direct foreign real estate not specified foreign financial asset. Through foreign entity (partnership, corporation, trust) interest is reportable.
What are 8938 penalties?
$10K base. Additional $10K per 30 days after IRS notice (max $50K). 40% accuracy-related on underpayment related to undisclosed assets. Reasonable cause defense.
What is reasonable cause for 8938?
Good faith + reasonable reliance on facts or professional. Document reliance. Foreign-domiciled taxpayer unaware of U.S. reporting common reasonable cause.
Does crypto count on 8938?
IRS position: yes when in foreign financial account. Self-hosted less clear. Instructions developing. Conservative: include.
Are joint accounts included?
Yes. Each filer reports value. For MFJ joint returns, single 8938 covers both. For separate filers, each files.
Does FATCA affect foreign banks?
Yes. Foreign financial institutions report U.S. persons’ accounts to IRS (or their governments via IGA). IRS matches to 8938. Mismatches trigger audit.
What's the streamlined 8938 path?
Streamlined procedures cover 8938 delinquency. Non-willful delinquent filers. Amendment of prior returns. Penalty structure mirrors FBAR streamlined.
Do entities file 8938?
Yes. Specified domestic entities file. Generally closely-held entities with foreign investments. Testing per regulations.
Next Steps
Form 8938 question? 15-min consultation free.
- FATCA authority: IRC §6038D; Treas. Reg. §1.6038D-1 through -8.
- 40% accuracy-related: IRC §6662(j).
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